Mercurial not found

After updating TortoiseHg from v3.9.2 to v4.0, SourceTree now reports "Mercurial not found" when launched. The Mercurial executable file hg.exe still exists in C:\Program Files\TortoiseHg. The SourceTree dialog has a "Browse to the location of Mercurial" button, but it does not do anything (expected behavior: a file explorer window would open so I could point to hg.exe; observed behavior: no explorer window opens, and the SourceTree dialog simply reappears with the same message). Is anybody else seeing this? Does SourceTree perhaps not recognize Mercurial v4.0? (Windows 10 Pro, 64-bit, SourceTree 1.9.6.1).

Just installed fresh 1.9.10.0 on a clean machine. Same problem, it wouldn't let me use the system git and mercurial. I had to let the application download internal ones as there was no other option to use it.

FWIW, the "Use System Mercurial" button still does nothing in SourceTree v2.0.19.1. Like you (and others, I'm sure), I'm stuck with SourceTree using its out-of-date embedded version of Mercurial, 3.7.3, although the latest Mercurial 4.1.3 is installed and working on my machine.

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